Several of my non-profit clients are organizations that until recently have had contracts with the BC Government to deliver employment training services. In March this year, the government announced the creation of the “Employment Program of British Columbia” and requested proposals in 73 areas for proponents to offer this program.
My understanding is the Employment Program is an umbrella for a diverse range of employability training activities targeting different client groups. As the organizations and companies in the sector scrambled to respond to this RFP, it became clear that there was going to be a new industry structure with the successful proponents actually contracting out components of the Employment Program to other organizations with specialist expertise, where the population and needs of the clients warranted these specialist programs.
I realize I’m coming late to the party when it comes to commenting on this industry change, but I have been getting increasingly concerned about this government move. Seeing the list of successful proponents has crystallized my concern.
First of all, the “super-agency” structure that is getting created by this Employment Program is wasteful. Previously, the government has hired public service employees to contract with organizations who deliver programs to meet distinct market needs. The public service employees administer the contracts and follow up to see that there is accountability on how the dollars are being spent. Now, the government will still have those public sector employees on the payroll, but now they will be administering fewer but bigger contracts. The super-agencies will be ALSO hiring employees to administer contracts with organizations who deliver programs to meet distinct market needs. Yes, some of the super-agencies will do their own delivery but the nature of employment training is that there are always going to be needs for specialized training settings or structures, and it’s not efficient for the super-agencies to try to address all those needs under one roof. So the front-end organizations are still there, delivering their programs… and now there are super-agencies who track accountability etc… but the government STILL has to track accountability via the super-agencies. There’s another layer of oversight being added, with no extra money to spread around. With all due respect to the fine men and women (mostly women, really) who are working hard at all levels of this structure and who more than deserve their paycheques… this is grossly unproductive. Instead of spending money on training resources, the government has just created a new expensive layer of oversight in these super-agencies who will babysit the organizations who will do exactly what they used to do, but with smaller budgets.
There’s another element to this change which bothers me, and that’s the appearance of for-profit businesses acting as super-agencies. It bothers me because the mandate and sole purpose of a for-profit business is to make a profit and that means that every available tax dollar will no longer be going to help the citizens of our province who need employment training. In order for a for-profit business to want to engage in this industry, there has to be a reasonable expectation that some of our tax dollars will end up in corporate pockets. They might be noble pockets who are good at their jobs, but I don’t pay taxes so that a company whose parent is a Big-10 accounting firm can deliver shareholder returns.
(Edit: 2:21pm Nov 17 – I just want to clear something up – I was writing this on the mistaken belief that one of the successful proponents (GT Hiring Solutions) was a subsidiary of Grant Thornton, but upon further investigation I have found this to be untrue. It’s a subsidiary of a different for-profit consulting firm, Chemistry Consulting Group, owned by very respectable and worthy individuals with a past employment relationship with Grant Thornton. I don’t know the details behind the name GT Hiring Solutions).
This escapade demonstrates why the Liberal government’s modus operandi of privatizing services to citizens is fundamentally and critically flawed. They may believe they’re creating jobs and reducing the size of the public service, but they’re really just handing off responsibility for effectively serving the citizens and guests of this province to a group of corporate bodies whose first and only priority is profit.
Damnit, I’m even madder than I was before. So much for blogging as catharsis.
Fast Company published an article on their site entitled “Culture Eats Strategy for Lunch.” I barely got halfway through before my inner blogger started screaming “DISAGREE! DISAGREE!”
What kind of impact do you make?
It’s been my pleasure to have some discussions with several successful and talented people in small business and not-for-profit organizations recently around the topic of impact. More specifically, what is the impact we make on our clients and society as a result of our actions?
For entrepreneurs, impact is most often measured by the profits generated by the company. If you are financially successful, it is assumed that you’re offering a product or service that your customers view as having value, so they exchange money for it. You are able to generate that product or service for less money than what people are willing to pay. Henceforth, profit – and out of the jobs we create, the taxes we pay and perhaps the charitable donations we make, we can say we have a net positive impact on society.
On the not-for-profit side, impact is less easily quantified. What is the scorecard to be used in measuring how successful an organization is at saving dolphins, enriching lives, or protecting the weak? The Census doesn’t ask people subjective questions so there isn’t a statistically reliable (or not, alas) way to measure quality of life. I think this is one of the great challenges facing non-profit Boards: to define the social good in such a way that they can demonstrate a positive impact. And even if they could, they are still bound to a financial measure in that they have to be able to attract enough funding to deliver their services in a way that allows them to break-even or have a reinvestable surplus.
Jim Collins (author of Good to Great) has penned an addendum to that notable work, Good to Great for the Social Sectors. It’s actually available on Kindle (I read it on my iPad, having downloaded it via BC Ferries’ wifi connection last week – I ♥ mobility!) as well as printed form. It’s a quick read, and it will actually benefit people in for-profit, not-for-profit or anywhere in between, because it will make you think about your impact. Thanks to the fine folks at Power to Be Adventure Therapy for telling me about this book!
I also just watched the first 15 minutes of this video about Financial Planning for Startups, which talks about why money is important for startups: because the ability to generate money is the sign of a sustainable business model. I think the ability to generate money is one thing, but the ability to use it wisely – to create an impact – is something entirely different and much more important in profit and not-for-profit organizations. (Maybe if more people in the tech-start-up field were trying to use money wisely rather than just generate money, we’d have been spared the tech bubble and the ludicrous valuations of tech start-ups that do very little aside from look good and play foosball. But I digress).
I’m going to watch the rest of this video now… I just had to pause for this blogging moment.